Natura &Co Latam rebounds from last quarter and achieves 15% profitability in Q1-25
Gross margin reached 67.1% in Latin America, driven by solid year-on-year expansion in the countries where the Natura and Avon brands have already been integrated (Wave 2)
Net revenue of the Latin American business unit grew 12.2% in CC compared to Q1-24, sustained by the strong performance of the Natura brand
SíO PAULO, May 12, 2025 /PRNewswire/ -- Natura &Co (B3: NTCO3), the leader in beauty and personal care in Latin America1, ended the first quarter of 2025 with revenues of R$5.3 billion in the region, up 12.2% compared to Q1-24 in constant currency (CC) (+4.1% excluding Argentina). Total revenue was R$6.7 billion, including R$1.4 billion from Avon Internacional2.
In the Latin American operation, the recurring EBITDA margin reached 15% (13.9% adjusted for non-operational impacts), exceeding the result of 9.6% reported in the last quarter and growing +50 bps year-on-year. The profitability improvement reflects the expansion in gross margin, which reached 67.1% in Latin America, driven by expansion in the countries where the integration of the Natura and Avon businesses has already been implemented, the so-called Wave 2. Greater efficiency in the management of general and administrative expenses also contributed to the evolution of the margin.
The Q1-25 results were driven by the Natura brand performance, which recorded a revenue increase of 8.2% in Brazil and 38.4% in the Hispanic countries (mid-teens excluding Argentina). In Brazil, robust retail growth was driven by strong same-store sales performance and a consistent pace of new store openings, reaching 149 owned stores (+34 compared to Q1-24) and 869 franchises (+88 compared to Q1-24). In digital, sales increased by 34.7% year-on-year, with the brand's share of voice on social networks growing, leading the main platforms in the beauty category. "Latin America's performance this quarter contributes to our ultimate goal of achieving year-on-year expansion of the recurring EBITDA margin to by the end of 2025. Efficiencies from Wave 2 will continue to be partially reinvested in marketing and other strategic fronts, with some volatility between quarters, but on a more balanced basis compared to previous years, given that investments are better spread over the periods. In addition, the implementation of Wave 2 in Mexico and Argentina is expected to be completed in 2025. As a result, the transformation cost cycle will end this year and should not exceed the total recorded in 2024," commented Natura's CEO, João Paulo Ferreira.
From an ESG perspective, one of the highlights of the period was that the Celaya plant in Mexico became the first Natura facility in Latin America to be fully powered by certified solar energy. The initiative is part of the company's decarbonization strategy and has already reduced carbon emissions by approximately 1,000 tons. The plant is expected to reduce its annual emissions by 83%, aligning efficiency gains with climate goals."As we move forward on the journey of simplifying our structure and focusing on operations in Latin America, our commitment to the ESG agenda remains unwavering, and it generates a competitive advantage to the business, reflected on continuous progress in our social and environmental goals," said the CEO.
This year, Natura was recognized for the 14th time as one of the World's Most Ethical Companies by the Ethisphere Institute. It also received, among other awards, the "Corporate Sustainability Bond of the Year" from Environmental Finance, highlighting its leadership in sustainable finance.
Natura &CoNatura &Co's net loss in Q1-25 decreased by 84% compared to the same period in 2024, reaching R$151 million, against R$935 million in the previous year.
The company's simplification journey, which began three years ago, has taken an important step forward which reinforces its focus on Latin America. In March, the incorporation of Natura &Co Holding by Natura Cosméticos was announced, a proposal approved by shareholders on April 25.
The full results report and financial statements can be accessed at https://ri.naturaeco.com/en/.
Q1-25 Earnings Conference Call on 5/12 at 8:00 AM (New York time) / 1:00 PM (London time) at https://tenmeetings.com.br/ten-events/#/webinar?evento=ConferenciadeResultados1T25-NATURA_262
About Natura &Co Natura &Co is a purpose-driven group that brings together Natura and Avon brands, connecting with consumers through a network of 4.8 million Beauty Consultants and Representatives, over 1,000 stores, and more than 19,000 employees. The group operates through two business units: Natura &Co Latin America, which oversees the global management of Natura and Avon across Latin America, and Avon International, which leads the brand's operations in Asia, Europe, Oceania, and Africa.
1 Source: Euromonitor International; umbrella brand Natura , Beauty and Personal Care 2025ed; retail value sales (RSP), 2024 data 2 In 2024, Avon International was accounted for as discontinued operations until it was reconsolidated on December 4.
View original content:https://www.prnewswire.com/news-releases/natura-co-latam-rebounds-from-last-quarter-and-achieves-15-profitability-in-q1-25-302453070.html
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